Treasury chief Alistair Darling said Sunday that struggling bank Northern Rock PLC will be nationalized after the government rejected two private takeover bids.
Darling told a news conference that the ailing mortgage lender would be placed under temporary public ownership because both bids had failed to meet the government's demands.
He said neither a proposal from Richard Branson's Virgin Group nor an in-house management team delivered ''sufficient value for money to the taxpayer.''
The government had said more than 25 billion pounds (US$49 billion; euro33 billion) in government loans must be paid back within three years.
''Taking into account the wider considerations, I've concluded this is the right approach,'' Darling told the news conference.
''It is our belief that the company can be moved back into the private sector at the earliest and most prudent opportunity,'' he said.
... Corporate troubleshooter Ron Sandler has been appointed head of the newly nationalized bank, Darling said.
An ex-head of Lloyd's of London insurers, Sandler is regarded as close to Prime Minister Gordon Brown.
- BECAUSE THEY RUN THE NHS SO WELL, AND HAVE DONE SUCH A PERFECT JOB RUNNING THE BRITISH NAVY.
- AND A FRIEND OF THE PM WILL RUN IT. HOW.... SOCIALIST.
- "He said neither a proposal from Richard Branson's Virgin Group nor an in-house management team delivered ''sufficient value for money to the taxpayer.'' -- AS IF BUREAUCRATS KNOW MARKET VALUE BETTER THAN... ER , UM... THE MARKET.
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